Wiley-Trading-Harry-Boxer-Profit

["technical thrust of the move accompanied by strong relative volume probably across key resistance was most likely the reason it came to my attention in the first place. So monitoring those huge daily price\/volume percentage surges is certainly an excellent source for discovering potential swing-trade candidates. Just one very strong daily move itself can and often does initiate an important price move that can last weeks or months. Holding a stock for longer than just a day trade generally becomes known a swing trade, but there are differing opinions and definitions as to what exactly a \u201cswing trade\u201d is time-wise. Generally, traders consider a swing trade to be anywhere from a few days to a few weeks. My personal opinion is as little as four to five days to probably a maximum of three to four weeks. You will often hear swing trading defined as \u201cmomentum trading.\u201d A swing trade is open longer than a day, but shorter than trend-following trades or buy-and-hold investment strategies. Swing trading also differs from the buy-and-hold approach to investing. Long-term investors may hold a security through periods of weakness that may last several months or years. Swing traders don\u2019t care for such poor performance in the near term. If a security\u2019s price is performing poorly, swing traders exit first and ask questions later. Swing traders are nimble and judicious in choosing potential opportunities, and market timing is critical to swing trading stocks Swing trading, as opposed to day trading, at least allows you to take a breath. While you still have to watch your stocks to ensure that key levels are not breached, you do not have to watch the tape very closely intraday, which many who are working and not trading for a living just do not have the time or stomach for. Without offending the swing traders of the world, I would dare to say that you can swing trade on a part-time basis and still turn a profit. You\u2019ll probably have much fewer trade decisions to make, but you still need to","develop a thorough trading plan with entry, exit, and stop points. Swing trading can provide for a much larger profit potential than day trading, which can tend to be hit and run or scalping oriented and beyond. Because your time frame for trading is larger, your profit targets may also be greater. This is where swing trading becomes fun. For example, you can have a set profit target, but because your holding period is much longer than day trading, you actually can let your profits run a bit. Swing trading does not require you to place trades daily, making it easier for those occupied for most of the trading session due to work or vacations and so on. Generally, trades are placed every few days to two to three weeks. The reason for the lengthier time is that you need to provide the stock the ability to \u201cswing\u201d from one price point to the next. There are times when a stock will just have a breakaway gap and you will, of course, hold off on the two- to three-week timeline and just let the stock run. Holding positions for more than a day also has the exact opposite risk profile of day trading. Having less margin to use naturally reduces your risk; however, swing trades expose you to holding positions overnight. For me, this introduces too much risk relative to day trading. Most news events such as earnings, public relations announcements, or analyst recommendations occur outside of normal trading hours. I personally just cannot risk waking up and seeing that my stock has gapped down 20 percent or more from the previous day\u2019s close on a surprise announcement. Certainly, swing trading also requires you to have more patience, and I clearly do not like to wait for things (type A personality?). You may hold your trade for a few days or weeks. It really depends on how well the stock trends. The periods of time where it is unknown whether I will close the trade out with a profit increase my anxiety levels to a point outside of my comfort zone. Make a swing trade that\u2019s more","likely to yield good results by getting to know the following signs of favorable conditions: Six Criteria to Look for When Choosing Swing Trades 1. The market is on your side. You\u2019ve determined that the market is trending in the same direction you want to swing trade. (If it isn\u2019t, you may need to find a different trending market entirely.) 2. The industry group is on your side. Stocks tend to follow their industry groups up or down. If the security\u2019s industry group is trending strongly in the same direction you want to swing trade, chances are that your trade will be profitable. 3. If you\u2019re trend trading, the candidate is moving out of a base. The candidate should be in an existing uptrend or downtrend that has pulled back in the short term. 4. If you\u2019re trading ranges, the candidate has just bounced off of support\/resistance with a technical indicator confirmation. Watch for the technical indicator (an oscillator) to generate a buy or sell signal. Divergences between your oscillator and the price action signal higher-confidence trades. 5. The stop-loss level is near your desired execution price. The best swing-trading candidates are those where your emergency exit is nearby. The closer your desired entry price is to your stop-loss level, the less you stand to lose if matters turn ugly. 6. You make a disciplined, not emotional, decision to allocate the right amount to the trade. Loss is always possible, even with the best swing-trading candidate. Set your position size in accordance with your trading plan, which should put an absolute ceiling on your position","size and set a maximum percentage of capital you\u2019re willing to lose.","\u00a0\u00a0\u00a0CHAPTER 16\u00a0\u00a0\u00a0 Rules and Guidelines to Better Trading The previous chapters have covered all the technical analysis methods, techniques, and philosophies that I have used and developed over the past nearly 50 years, and I believe they will make you a better and more profitable trader. Before I conclude, I want to give you some rules and guidelines to enable you to be a better, more profitable day and swing trader: 1. Know your entry price, exit price, and stop-loss even before you enter the trade in case of a worst-case scenario. \u00a0 \u00a0 \u00a0 This is rule number one for a reason. Before you press the \u201cEnter\u201d key, you must know when to get in, when to get out, and what to do if the trade doesn\u2019t work out as expected. A stop price is essential if you want to minimize losses. Knowing when to get in or out will help you to lock in profits, as well as save you from potential disasters and large capital drawdowns. 2. Avoid trading during the first 15 minutes of the market open. \u00a0 \u00a0 \u00a0 It\u2019s very tough to trade in the first 10 to 20 minutes, and it takes years of trading experience","and an acquired confidence level before you should consider trading near the opening. Those first 15 minutes of market action are often panic trades or market orders placed the night before. Novice day traders should avoid this time period while also looking for reversals. 3. Use limit orders, not market orders. \u00a0\u00a0\u00a0A market order simply tells your broker to buy or sell at the best available price. Unfortunately, best doesn\u2019t necessarily mean profitable. The drawback to market orders was revealed during the May 2010 \u201cflash crash.\u201d When market orders were triggered on that day, many sell orders were filled at 10, 15, or 20 points lower than anticipated. A limit order, however, lets you control the maximum price you\u2019ll pay or the minimum price at which you\u2019ll sell. You set the parameters, which is why limit orders are recommended. Only the most experienced traders with the highest level of confidence should consider market orders. 4. Rookie traders should avoid using margin. \u00a0 \u00a0 \u00a0 When you use margin, you are borrowing money from your brokerage to finance all or part of a trade. Full-time day traders (i.e., pattern day traders) are usually allowed 4:1 intraday margin. For example, with a $30,000 trading account, you\u2019ll be given enough buying power to purchase $120,000 worth of securities. Overnight, however, the margin requirement is still 2:1. \u00a0 \u00a0 \u00a0 When used properly, margin can leverage, or increase, potential returns. The problem is that if a trade goes against you, margin will increase losses. One of the reasons that day trading got a bad name a decade ago was the use of margin\u2014","when people cashed in their 401k(s) and borrowed bundles of money to finance their trades. When the bull market ended in 2000, so did many traders\u2019 accounts. Bottom line: if you are a novice trader, first learn how to day-trade stocks without using margin. \u00a0\u00a0\u00a0For the experienced trader, margin can be one of the best vehicles for compounded profits exponentially, so it\u2019s very attractive and tempting, but the risk remains at all times, and one must be disciplined or watch their trading capital rapidly disappear. 5. Have a selling plan. \u00a0\u00a0\u00a0Many rookies spend most of their time thinking about stocks they want to buy without considering when to sell. Before you enter the market, you need to know in advance when to exit. \u201cPlaying it by ear\u201d is not a selling strategy, nor is hope. As a day trader, you need set a price target as well as a time target even before you enter your trade. 6. Keep a journal of all your trades. \u00a0 \u00a0 \u00a0 Many pros swear by their journal, where they keep records of all their winning and losing trades. Write down what you did right or wrong. Doing so will help you improve as a trader, which is your primary goal. Not surprisingly, you\u2019ll probably learn more from your losers than your winners. 7. Rookie traders should first practice day trading in a paper-trading account for a few weeks. \u00a0 \u00a0 \u00a0 Although not everyone agrees that practice trading is important, it can be beneficial to most rookie traders. If you do open a practice account, be sure to trade with a realistic amount of","money. It\u2019s not helpful to practice trade with a million dollars if the most you have in your account is $30,000. Also, if you do practice trade, think of it as an educational exercise, not a game. 8. Learn to unemotionally cut your losses. \u00a0\u00a0\u00a0Managing losing trades is the key to surviving as a day trader. Although you also want to let your winners run, you can\u2019t afford to let them run for too long and turn against you. Learning how to control losses is essential if you are going to day trade. 9. Be willing to lose before you can win. \u00a0 \u00a0 \u00a0 Although many traders can handle winners, controlling losing stocks can be difficult. Many rookies panic at the first hint of losses, and end up making a series of impulsive trades that cost them money. If you\u2019re day trading, you must be willing to accept some losses. The key: knowing in advance what level your protection is (stop- loss). \u00a0 \u00a0 \u00a0 Although anyone can learn to day trade, few have the discipline to make consistent profits. What trips up many people are their emotions, which is why it\u2019s so important to create a set of flexible rules. Your goal: follow the rules to help keep you on the right side of any trade. 10. Trade strong stocks long in an uptrend; short weak stocks in a downtrend. \u00a0 \u00a0 \u00a0 Most traders will find it beneficial to trade stocks with a high correlation to the major indexes; stocks that are relatively weak or strong, compared to the index, can be isolated. This creates an opportunity for the day trader, as he or she can isolate which stocks are likely to","provide a better return, given the movement of individual stocks relative to the index. \u00a0 \u00a0 \u00a0 When the indexes\/market futures are moving higher, traders should look to buy stocks that are moving up more aggressively than the futures. When the futures pull back, a strong stock will not pull back as much, or may not even pull back at all. These are the stocks to trade in an uptrend, as they lead the market higher and thus provide more profit potential and lower risk; smaller pullbacks mean less risk. \u00a0 \u00a0 \u00a0 When the indexes\/futures are dropping, short sell stocks that drop more than the market, percentage-wise. When the futures move higher within the downtrend, a weak stock will not move up as much or will not move up at all. Weak stocks are less risky when in a \u201cshort\u201d position and provide great profit potential when the market is falling. 11. Wait for the pullback\/retest. \u00a0\u00a0\u00a0Trend lines are an approximate visual guide to where waves in price will begin and end. Therefore, we can use a trend line for entry into the next price wave in the direction of the trend. When entering a long position, buying after the price moves down toward the trend line and then moves back higher tends to be profitable. \u00a0 \u00a0 \u00a0 Short selling in a downtrend would be similar. Wait until the price moves up the downward- sloping trend line, then when the stock begins to move back down, this is when the more probable profitable entry can be made. \u00a0\u00a0\u00a0These two trend line trade guidelines provide a very low-risk entry, as the purchases are made","close to the stop level, which could be several cents below the trend line. Some final additional guidelines to consider: Don\u2019t commit all your cash at once. In a fast-moving market, opportunities come up all the time. Try to keep some cash on hand to take advantage of those opportunities. Discover and use hedging techniques. Just because you\u2019re bullish doesn\u2019t mean that you can\u2019t also put on a bearish position or buy an inverse exchange-traded fund (ETF) for portfolio protection when the markets look weak and headed lower, even intraday. Hedging techniques protect you when the market moves against you. Use discipline and patience versus emotion and panic. Part of the human equation in the world of financial markets is that fear and greed can become irrational, short-term drivers of prices. Instead of joining the crowd, watch them to give you an advantage in assessing a stock\u2019s price movements. Stick with your plan and use discipline and patience. \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Day and swing traders should ideally trade with the overall trend and patiently wait for low-risk entries to potentially profit from that trend. Trend lines, moving averages, and key support levels should be used as a guide to help traders determine these low-risk entry points, as well provide potential stop levels. Buying stocks that are stronger than the index in uptrends and shorting stocks that are weaker than the index in downtrends should provide more safety and relative outperformance profits. Don\u2019t trade when the trend is unclear. Cash can be king in times of panic. Don\u2019t let the money burn a hole in your pocket! Be patient! Remember, many of the most successful traders I\u2019ve known and admired were only in the market 30 to 40 percent","of the time. The rest of the time they were being cunningly patient, doing their homework and analysis, holding cash positions, waiting for the next big opportunity and the right setups to present themselves. Those are the traits of the most successful traders in market history.","\u00a0\u00a0\u00a0CHAPTER 17\u00a0\u00a0\u00a0 38 Steps to Becoming a Successful Trader Most traders will identify with this list and should be able to place themselves within these steps. Keep in mind that few people progress through these steps in an orderly fashion. Developing your trading skills is an iterative process. For example, you may reach step 13 and find that, although you were making money, your basic premise for trading was flawed (you might have been benefiting from the bull market, rather than your own trading prowess and then have been rudely awakened when the market entered a bear phase). You may drop back to step 4 and start \u201cclimbing\u201d the steps again. Having the proper mind-set, attitude, and psychological makeup becomes increasingly important as you progress through the steps. The focus of the earlier steps is on external issues (i.e., developing proficiency in the mechanics of trading), while the focus of the latter steps is on internal issues (i.e., improving ourselves mentally and psychologically, maturing as traders). 1. We accumulate information\u2014buying books, going to seminars, and researching. 2. We begin to trade with our \u201cnew\u201d knowledge. 3. We consistently \u201cdonate\u201d and then realize we may need more knowledge or information. 4. We accumulate more information.","5. We switch the commodities we are currently following. 6. We go back into the market and trade with our \u201cupdated\u201d knowledge. 7. We get \u201cbeat up\u201d again and begin to lose some of our confidence. Fear starts setting in. 8. We start to listen to \u201coutside news\u201d and to other traders. 9. We go back into the market and continue to \u201cdonate.\u201d 10. We switch commodities again. 11. We search for more information. 12. We go back into the market and start to see a little progress. 13. We get overconfident and the market humbles us. 14. We start to understand that trading successfully is going to take more time and more knowledge than we anticipated. (Note: Most people will give up at this point, as they realize work is involved. Keep going.) 15. We get serious and start concentrating on learning a \u201creal\u201d methodology. 16. We trade our methodology with some success but realize that something is missing. 17. We begin to understand the need for having rules to apply our methodology. 18. We take a sabbatical from trading to develop and research our trading rules. 19. We start trading again, this time with rules, and find some success, but overall we still hesitate when we execute. 20. We add, subtract, and modify rules as we see a need to be more proficient with our rules. 21. We feel we are very close to crossing that threshold of successful trading.","22. We start to take responsibility for our trading results as we understand that our success is in us, not the methodology. 23. We continue to trade and become more proficient with our methodology and our rules. 24. As we trade, we still have a tendency to violate our rules, and our results are still erratic. 25. We know we are close. 26. We go back and research our rules. 27. We build confidence in our rules and go back into the market and trade. 28. Our trading results are getting better, but we are still hesitating in executing our rules. 29. We now see the importance of following our rules as we see the results of our trades when we don\u2019t follow the rules. 30. We begin to see that our lack of success is within us (a lack of discipline in following the rules because of some kind of fear), and we begin to work on knowing ourselves better. 31. We continue to trade, and the market teaches us more and more about ourselves. 32. We master our methodology and our trading rules. 33. We begin to consistently make money. 34. We get a little overconfident and the market humbles us. 35. We continue to learn our lessons. 36. We stop thinking and allow our rules to trade for us (trading becomes boring but successful), and our trading account continues to grow as we increase our contract size. 37. We are making more money than we ever dreamed possible.","38. We go on with our lives and accomplish many of the goals we have always dreamed of.","\u00a0\u00a0\u00a0\u00a0ABOUT THE ONLINE VIDEO\u00a0\u00a0\u00a0\u00a0 Profitable Day and Swing Trading is accompanied by two online videos, which expand on the lessons and examples presented in the book: 1. Day Trading with Harry Boxer \u00a0\u00a0\u00a0A video of technical analysis techniques for looking at 1-minute and 5-minute intraday trading charts. 2. Swing Trading with Harry Boxer \u00a0\u00a0\u00a0A video of technical analysis techniques for short-term and swing trading. To get the URL and access code for your online video, please refer to the printed card at the end of this book. If you purchased an e-book, you can find instructions for verifying your purchase and obtaining an access code at the end of this book.","\u00a0\u00a0\u00a0\u00a0INDEX\u00a0\u00a0\u00a0\u00a0 A Adept Technologies (ADEP) Aetrium, Inc. (ATRM) Air Products (APD) Alliance Fiber Optic (AFOP) America-Invest.com Anika Therapeutics (ANIK) Appel, Gerald Applied Micro Circuits (AMCC) Arrowhead Research (ARWR) Autozone (AZO) B Balance of Power (Worden Brothers) Bearish crossover Bernstein, Joel Best Buy (BBY) Bitauto Holdings Limited (BITA) Bollinger, John Bollinger Bands conclusions interpretation M tops rules for using W bottoms walking the bands \u201cBoxer Wedge\u201d Bull flags Bullish and bearish divergences","Bullish and bearish setups Bullish crossover C Calumet Specialty Products (CLMT) Canadian Solar Inc. Center-line crossovers Channels and angles Coils Crossover signals Crown Castle (CCI) Cummins Inc. (CMI) D Daqo New Energy (DQ) Day trading fifth-wave exit method for measured move patterns best intraday rising parallel channel with high relative volume low-volume \u201cebb\u201d time frame parameters Demark, Tom Divergences and loss of momentum. See also Technical divergences and loss of momentum E Early trend development, analyzing disciplined, organized, focused approach, developing early price\/volume action, monitoring focus list, creating Worden Brothers Volume Buzz indicator Elliott, Ralph Nelson","Elliott Wave cycle analysis Elliott Wave Theory Exit points, determining fifth-wave exit method for day trading logarithmic or percent scaling measured move method Exxon Mobil (XOM) F False signals Feldman, Steve Fibonacci, Leonardo Fibonacci analysis Fishman, Gary Fifth-wave exit method for day trading Focus list, creating Foundation Medicine (FMI) Fractals G Gamestop (GME) Gentium (GENT) Google (GOOG) Granville, Joe Greenstein, Hank Grey Television (GTN) Guidelines. See Rules and guidelines H Hefter, Richard Himax Technologies (HIMX) Histogram Home Depot (HD) daily chart Hughes, Neil","I International Business Machines (IBM) International Gaming Tech (IGT) Intraday rising parallel channel with high relative volume J Jinko Solar (JKS) K Kohls (KKS) Kongzhong Corporation (KONG) L Lane, George C. Logarithmic or percent scaling Low-volume \u201cebb\u201d M M tops Market predictions based on wave patterns Markwest Energy Partners (MWE) Measured move method Medtronic (MDT) Mellanox Technologies (MLNX) Micron Technology (MU) Momentum trading. See Swing trading MoneyStream (Worden Brothers) Monsanto (MON) Motorola (MOT) Moving average convergence\/divergence (MACD) conclusions divergences and loss of momentum false signals formula","interpretation signal-line crossovers zero or center-line crossovers Moving averages crossover signals N Network Appliance (NTAP) Nordstrom (JWN) O On-balance volume (OBV) and divergences calculation divergences interpretation trend confirmation Opening gap price Overbought\/oversold levels P Pandora Media (P) Patterns best intraday rising parallel channel with high relative volume low-volume \u201cebb\u201d PDC Energy (PDC) Pennants Position sizing and money management. See also Stops, determining and setting raising and adjusting stops as price progresses stop-loss as money management tool trailing stop method Price trend angle divergences Price\/volume surge Pulte Homes (PLT) daily chart","Q QQQQ daily chart R Regado Biosciences Inc. (RGDO) Rentech Nitrogen Partners (RNF) Rockwell Medical (RMTI) Rules and guidelines S Sandisk (SNDK) Shapiro, Harris Signal-line crossovers Solar City (SCTY) Solarwinds Inc. Somekh, Bill S&P 500 exchange-traded fund (SPY) Starbucks (SBX) Stemline Therapeutics, Inc. Stochastic oscillators, interpretation and use of bullish and bearish divergences bullish and bearish setups calculation and interpretation conclusions fast, slow, or full overbought\/oversold overview Stops, determining and setting. See also Position sizing and money management under key trend-line violations using key moving average violations where important price support levels are violated Successful trading steps to Support and resistance lines","Swing trading criteria to look for when choosing T Targets and price objectives, setting exit points, determining fifth-wave exit method for day trading logarithmic or percent scaling measured move method Fibonacci and Elliott Wave cycle analysis market predictions based on wave patterns theory interpretation wave categories, series of Technical Analysis Challenge Technical divergences and loss of momentum Balance of Power conclusions MoneyStream on-balance volume and divergences calculation divergences interpretation trend confirmation price trend angle divergences underlying technicals diverging from price Texas Instruments (TXN) Theory interpretation thetechtrader.com 3M (MMM) Trading session, preparing for analyzing patterns from previous trading day morning routine what to look for Trading style","targets, where to set Trailing stop method Trend confirmation Trend lines, drawing channels and angles reviewing and adjusting support and resistance lines V Valero Energy (VLO) Ventas (VTR) Vision China Media (VISN) Volume Buzz indicator (Worden Brothers) W W bottoms Wave categories, series of Wave patterns, market predictions based on Wedges Worden Brothers Balance of Power MoneyStream Volume Buzz indicator WUBA X XPO Logistics Inc. (XPO) Y Yahoo (YHOO) Z Zero crossovers Zhone Technologies (ZHNE)","Your purchase of Profitable Day and Swing Trading by Harry Boxer includes access to the 80-minute online video seminar. Please go to www.wiley.com\/go\/boxertradingebook to verify your purchase and receive an access code. For technical support, please visit www.wiley.com. For telephone support, please contact us at: 1-800-762-2974 (U.S.), 1-317-572-3994 (International)."]